Alberta mortgage and land fees soar in budget

by Jamie Henry27 Mar 2015

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Alberta mortgage and land fees soar in budget

The housing market is going to suffer as Alberta bids to reduce its rising budget deficit. Land title and mortgage registration fees are set to soar after the government concluded there was “room to grow” in its fee structure. Service Alberta minister Stephen Khan said that as a result of discussions with stakeholders including lawyers and real estate associations he found a belief that Alberta’s fees are very low compared to other provinces.

The changes will be introduced from July 1st 2015 and will mean that the flat-fee for land title and mortgage registration documents will rise by 50 per cent; from $50 to $75. The other part of the fees is variable and in some cases will be 6 times higher than the current level. That means that to buy a $500,000 home in Alberta with a $400,000 mortgage the fees will rise from $150 for land title and $140 for mortgage registration to $675 for land title and $555 for the mortgage registration. That means the total payable rising from $290 to $1,230. Read the full story.

There is no tears shed for Alberta. They are just as bad as Quebec when it comes to paying their fair share of taxes, cost and entitlements. It is like watching Quebec students protesting against cut backs when they have the lowest tuition fees in Canada?

Crazy! I'd like to know the rationale here. Has it all of a sudden become that much more time consuming and labor intensive to register title? Does registering a $500K mortgage take any longer than registering a $150K mortgage? Room to grow is one thing but how in the world is this regime justifying a 400% increase?

This hike isn't just going to affect buyers/sellers but deals another blow to the already beaten down refinance market as well. We might as well call this exactly what it is H.O.T. Tax - Home Ownership Tax.

I find it very hard to believe that realtors and lawyers polled took news of this type of change in stride as Khan alludes to. And at what point do mortgage professionals become a sought after group of stakeholders in decisions such as this.

It's no wonder our Govt chose not to institute a provincial sales or consumption tax - there's not going to be much $ left for residents to actually use for consumption at this rate! Time to take a long hard look at the crew that is currently calling the shots in AB!

It looks like an attempt to raise the bar to home ownership in an era of cheap mortgage money. Probably worries of first time-homebuyers over-extending themselves and bubbles. Nothing like adding another $1000+ to the initial cost of ownership to cool off the real estate market a little more.